Import of Gold - RBI wants Strict Discipline - No Credit in any form for import of Gold
RBI in its recent Circulars dated 13th May 2013 and4th June 2013 had decided to restrict the import of gold on consignment basis by banks, nominated agencies/ premier/ star trading houses who have been permitted by Government of India, to import gold only to meet the genuine needs of the exporters of gold jewellery. Further, it was advised that all Letters of Credit (LC) to be opened by Nominated Banks / Agencies for import of gold under all categories will be only on 100 per cent cash margin basis and imports of gold will necessarily have to be on Documents against Payment (DP) basis. Accordingly, gold imports on Documents against Acceptance (DA) basis will not be permitted.
RBI now clarifies that upon the issue of above instructions, import of gold against suppliers/buyers credit, as also import of gold on unfixed price basis has to necessarily observe the discipline stipulated relating to cash margins and Documents against Payment (DP) basis.
RBI stipulates that Banks are required to ensure that credit in any form or name is not enabled for import of any form of gold. Import of gold on loan basis may, however, continue to be allowed since the scheme envisages that the nominated banks/nominated agencies can import gold on loan basis for on-lending only to the exporters of jewellery in sync with the non-applicability of the above restrictions to exporters of gold jewellery.
RBI Circular AP (DIR Series) No. 122, Dated: June 27, 2013